The authorisation is subject to compliance with the RBI’s Master Directions on Prepaid Payment Instruments, dated August 27, 2021, as amended from time to time, according to the company’s disclosure to the stock exchanges.
Final authorisation required before wallet services
The in-principle authorisation does not allow PPSL to immediately launch wallet services.
The company will be able to offer prepaid payment instruments, including wallets, to customers after receiving the RBI’s final authorisation or Certificate of Authorisation (CoA), it said.
In its disclosure, One 97 Communications said PPSL had applied for a wallet licence, as mentioned in the company’s Q1 FY2027 earnings release.
Why did the RBI cancel Paytm Payments Bank’s licence?
The central bank prohibited PPBL from conducting banking business with effect from the close of business on the same day. It also said it would apply to the High Court for winding up the bank.
The RBI cited several reasons for the cancellation, including the bank’s affairs being conducted in a manner detrimental to its interests and those of depositors, and its failure to comply with the conditions of its payments bank licence.
In its April 24 press release, the RBI said the bank’s affairs were conducted in a manner “detrimental to the interest of the bank and its depositors”.
The central bank had earlier imposed restrictions on PPBL in January and February 2024, prohibiting further deposits, credits and top-ups in existing customer accounts, prepaid instruments and wallets. It had also stopped the bank from onboarding new customers from March 11, 2022.
The latest in-principle authorisation, however, has been granted to PPSL, a separate wholly owned subsidiary of One 97 Communications, and not to Paytm Payments Bank.
